Finance Minister Blaine Higgs released the first quarter financial results in Saint John on Sept. 27. (CBC)

New Brunswick's deficit is now projected to hit nearly $500 million for 2013-14, Finance Minister Blaine Higgs announced on Friday.​

That's up about $21 million from the deficit forecast in the March budget, due largely to revenue shortfalls related to NB Power and the start-up of the refurbished Point Lepreau nuclear generating station, he said.

But Premier David Alward says it would be a lot worse, if not for his government's tough choices, which have included holding the line on health care spending.

Alward is still hoping resource development, such as shale gas, can turn the numbers around.

The government's original goal of balancing the budget before next year's provincial election, however, will be impossible, Higgs said.

"It is not going to happen and we made that clear in our … three-year projection," he told CBC News.

Still, Higgs contends the Alward government deserves another term in office.

"As you just jump on a different horse, what you do is you just start from ground zero," said Higgs.

"We are building on a formula and I'd hate to see that formula just stopped," he said.

"We can demonstrate a very credible path for growing the economy and … the only way we’re going to be able to do that is to continue the process under the David Alward government."

Revenues are tracking about $41 million lower than forecast, according to the first quarter financial results released by Higgs in Saint John.

Weaker than anticipated results for NB Power are largely to blame, he said, due to increased costs for fuel, pensions and purchased power.

Spending, meanwhile, is about $20 million under budget, he said.

“This helps us to offset our revenue challenges and demonstrates the commitment of our public servants to changing the culture of government and continuously finding savings," Higgs said in a statement.

The net debt is projected to increase $619.2 million year-over-year, an increase of $24.7 million from the budget estimate of $594.4 million.

Search for savings continues

The Department of Post-Secondary Education, Training and Labour is currently about $9.9 million under budget, due in part to projected under-expenditures in the student financial assistance program and "lower than expected uptake for employment programs," according to the fiscal update.

Employment dropped by 2,500 in the first six months of the year, the financial results show.

The Department of Justice and Attorney General has under-spent by about $3 million so far, but mainly due to the transfer of certain functions to the new Financial and Consumer Services Commission.

Transportation and Infrastructure, meanwhile, has spent about $2.3 million more than expected, due to higher than budgeted expenses for ferry operations.

The Department of Natural Resources and Department of Tourism, Heritage and Culture are also tracking over estimates by about $400,000 and $292,000 respectively, the figures show.

Higgs said the government is still looking for savings in every department and Crown corporation.

"We're not going to be able to offset all of the revenue losses, so we have to continue to focus on the economic growth prospect," he said.

Asked whether the government will look at tax increases, Higgs said: "I think we have to be very careful there."

"We know that we just can’t keep taxing and we can’t keep going to that well for all of our solutions. We have to find more efficiency within government and I’m pleased to say that process is well underway," he said.

Higgs did not rule out the possibility of an HST hike.

"It would be a consideration if that’s the message we got from the [citizens], but it isn’t something we are considering at this time," he said.

It is the first financial update since the Alward government tabled its three-year budget on March 26 — six months ago.

At that time, the deficit was projected to hit $478.7 million for 2013-14.

Based on the first quarter information, there is a deficit of $499.9 million.

The Opposition Liberals have been calling on the government to release the first quarter results since July.

The first quarter includes the months of April, May and June.

During the announcement, Alward also mentioned the legislature will resume on Nov. 5.

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